Standing Committee F

[Mr. Derek Conway in the Chair]

Employment Bill

Clause 1 - Paternity leave

Question proposed [this day], That the clause stand part of the Bill. 
 Question again proposed.

Philip Hammond: Most of the issues that must be explored in clause 1 already have been, in some detail, by the amendments. Indeed, some debates have been considerably broader than the amendments. However, I would like to raise further issues with the Minister. I particularly enjoy stand part debates because Ministers must answer questions without having had the benefit of seeing them two days in advance.
 This morning, the Minister clarified a point that was exercising me about who would be entitled to paternity leave. The Minister made his now-withdrawn remark about the biological relationship between father and child being the important element. I am keen to ensure that, as we introduce more statutory rights, we do not inadvertently move away from encouraging a co-operative, discursive approach to settling matters such as taking leave. Amendments have been considered that would have made a nod in that direction, but I would be grateful if the Minister said something about his desire to see employees and employers working together to ensure that leave entitlements are dealt with in way that not only respects the needs and wishes of the employees, but is sensitive to the needs of businesses, particularly small business. 
 I hope that any guidance will make it clear that an employer will be expected, as part of good practice, to have an informal discussion with his employee to arrange something that is appropriate for both parties before he serves a bland notice on his employee telling him that he will be absent on such and such a date. An important feeling that has arisen from clause 1 discussion is disquiet on both sides of the Committee about the fact that we may be imposing, by statute, rigidities that employers and—in certain cases—employees would want relaxed. I refer to the discussion about whether leave can be taken in different form than a simple block of one or two weeks. 
 I want to raise the issue of polygamy with the Minister, which might sound strange. The Bill specifically addresses polygamous marriages and relationships but clause 1 clearly does not. Some employees could conceivably be found to be claiming 
 rather a lot of paternity leave on the basis of multiple births and their responsibilities to support multiple mothers. Will the Minister explain whether he intends to deal with the issue of polygamy in regulations. Some clauses provide a framework for dealing with multiple births or adoptions, which we will discuss later. However, there may be multiple claims for leave that are not a result of multiple births from one mother but of sequential births from different mothers with whom the employee has the specified relationship. We are obviously working in something of a vacuum as we do not know what the specified relationship is to be. It is probably safe to conclude, however, that marriage will be one of the specified relationships. 
 The Government have made it clear in the explanatory notes and in their response to consultation that they intend to set the period for statutory paternity leave at two weeks. As one would expect, the Bill is permissive, in that it requires that regulations set the period of leave, but it also provides that the regulations shall specify a 
''period of leave of at least two weeks.'' 
That does not seem very neutral phraseology. If the intention is to be permissive and to allow the detail to be established in regulations, it would seem appropriate simply to state that regulations will specify the period of paternity leave. Adding the requirement that regulations specify a period of at least two weeks suggests that there is another agenda. Given that two weeks is clearly seen as the minimum, the Government perhaps have some form of ratchet in mind. If so, that would be rather alarming, particularly to small businesses. I hope that the Minister can set my mind at rest and explain why the provision is phrased in that way. 
 We have already had a little discussion about the matters that will be treated as employee entitlements not arising under the contract. Proposed new section 80C(6), however, refers to regulations that 
''specify matters which are, or are not, to be treated as remuneration for the purposes of this section.'' 
That provision will prove important later, in terms of setting pay rates. It is presumably intended to deal with the question of whether tips and gratuities, for example, will form part of remuneration. I remember long and interesting debates on that subject during the National Minimum Wage Bill Committee. I should be grateful if the Minister would explain what regulations he has in mind in respect of matters that will and will not be treated as remuneration. 
 In proposed new section 80C(7), the language reverts to the permissive. It states that regulations ''may make provision'', but in the context of the right to return to work, of 
''seniority, pension rights and similar rights'', 
and of 
''terms and conditions of employment on return.'' 
I do not want to do the job of the hon. Member for Manchester, Central (Mr. Lloyd) for him, but in the spirit of this legislation, regulations must exist that ensure that people do not suffer loss of seniority, pension rights and so forth on returning to work. According to the proposed new section, the 
 Government ''may'' make provision through regulations. I hope, however, that the Minister will point out those areas for which the Government will indeed make provision, and those for which they are merely contemplating such provision. 
 Similarly, on the provisions relating to certification procedures and the producing of evidence, the Minister told the Committee that he intends that self-certification will be the standard form provided by an employee to an employer. Will there be a standard format? Will the process be carried out in writing, or will it be informal? More broadly, what other provision will he make in respect of the procedure for giving notice? Will it be given in writing, for example? He has given the Committee some information, but he did not give us specific details when he dealt with the amendments. 
 Turning to new section 80E, paragraphs (c) and (d) address: 
 ''the consequences of failure to give notices . . . and the consequences of failure to act in accordance with a notice''. 
The terminology is rather sinister, and we must know what those penalties would be because they will be provided for in regulations and the Committee ought to know their financial magnitude. Elsewhere in the Bill, especially in the sections relating to payments, the penalties are specified in monetary terms, and I would be grateful if the Minister were to say something about that. 
 New section 80E paragraph (f) provides for regulations: 
''modifying the effect of Chapter 2 of Part 14 (calculation of a week's pay) in relation to an employee who is or has been absent from work on leave under section 80A or 80B'', 
which are the two classes of paternity leave that we have considered. Will the Minister explain what modification is required to give proper effect to new sections 80A and 80B because it is not immediately apparent?

Rob Marris: More prosaically, I want to ask my hon. Friend the Minister about new section 80A(5)(b), which appears to be the twins or triplets paragraph. Do the Government intend that the father of newborn twins should get only two weeks or less than four weeks?

Alan Johnson: The first point made by the hon. Member for Runnymede and Weybridge (Mr. Hammond) concerned flexibility and the co-operative approach, by which he meant that the employer should talk to the employee because in the majority of cases where these provisions already exist as procedures introduced by the employer that kind of communication is part of the everyday operation of such schemes. We would certainly amplify best practice in the guidance that we shall produce. There is an inalienable right during the period of 56 days to take leave starting from the date of birth. When an individual gives notice, they can specify that they want to take their leave on the date of birth, which is not specific for obvious reasons, or they can choose to take a specific period starting on a specific date during the
 56 days. Consultation would be necessary in the cases of employees who say, ''I don't want leave from the date of birth, but I do want it from a couple weeks afterwards. Do you mind if I start it on a Monday?'' The employee has the right, which cannot be reduced or diminished, in that case, but I would still expect there to be constructive dialogue.
 If an employee wants to change the period once they have set it, which would mean that they had picked a specific period before deciding that they needed to change it, our intention in regulation would be that they must give 28 days' notice. The hon. Gentleman asked what would happen if they did not give notice; the answer is that they would not get the leave. 
 There are some questions that one does not expect to be asked in Committee, of which, ''Will the Minister deal with polygamy in the regulations?'' is one. I have a note on this matter, but perhaps it would be a mistake to read it out because I thought that I had grasped the matter before I read it. This may refer not to polygamy but to be the father of several children, for whatever reasons. I had better leave these things to hon. Members' imaginations.

Philip Hammond: Joking aside, the crucial point is that there may be children of several different relationships but, in order to qualify, that extremely busy man would have to care actively for the children and support their mothers, wherever they happened to be.

Alan Johnson: Yes. It would not be right to debar people in that situation from taking paternity leave for each child. Social security legislation has had to deal with polygamous marriages for some time. This is not the first time that such arrangements have been regulated by Government. Perhaps a previous Minister has been asked these questions on other Bills. We would obviously talk closely to the people who dealt with this in the past before we framed any regulations. We would have to ensure that we got it right. In general, the father should be entitled to paternity leave however many children were born, provided that he met the qualifications set out elsewhere in the regulations, particularly the parental qualifications.

Philip Hammond: Would the Minister find it convenient now to answer the question asked by the hon. Member for Wolverhampton, South-West (Rob Marris), which is relevant to this issue?

Alan Johnson: Yes, that concerns multiple births. There we simply mirror the maternity leave regulations where there is one period of leave. That has been the procedure for a long time under maternity leave. We see no reason to change it for paternity leave.

Philip Hammond: So a person who is in two simultaneous relationships, where two mothers give birth on the same day to two children is entitled to two periods of leave, but a person in a monogamous relationship whose partner gives birth on the same day
 to twins is entitled to only one period of leave. That does not sound equitable. It seems to send a rather rum signal.

Alan Johnson: One reason for paternity leave is to help the mother. In the first case, there are two mothers, and in the second, only one. That one mother receives one period of maternity leave. The hon. Gentleman raises important points. They are on the record. They need to be considered because there are complications that the regulations must address. Our principles, however, are basically sound.

Rob Marris: To take a more extreme, but not unknown, example, if a mother gives birth to quintuplets, one can envisage that a period of two weeks' paternity leave would be insufficient for the father. I urge the Minister to reconsider the twins clause. By parallel with maternity leave, I can see that there should not necessarily be 10 weeks' paid paternity leave in the case of quintuplets, but most of our constituents would recognise that if they were fortunate enough to father quintuplets, two weeks would be insufficient.

Alan Johnson: I will take those points into account. Generally we want to mirror the arrangements that have served us well for maternity leave for a long time. We do not want to have different arrangements for fathers. In some cases they have to be different, but we want to mirror the maternity arrangements as closely as we can.
 The next question was whether we intend to ratchet up the two weeks. We do not. We consulted widely on that, and we have no plans to increase the period. We have been advised by the hon. Member for Runnymede and Weybridge on several occasions to leave some flexibility. The reason for specifying at least two weeks is that it gives some licence for flexibility, although we have no plans to use it at the moment.

Philip Hammond: Why say anything at all? The power to determine the period by regulation would give the Minister flexibility upwards, but it gives him flexibility downward too. He has chosen to remove his flexibility downwards, which inspires the he has a specific agenda. Has anything been said about the minimum level?

Alan Johnson: We do not intend to reduce it downwards. That reminds me of the argument about the minimum wage. Do we intend to reduce the four weeks of paid holiday? No, once rights are established, we intend them to remain. As to the future, we have no plans for the level to come down, though changes may occur in the unforeseen future.
 What about the meaning of remuneration? Subject to consultation, we intend to make the same provision that applies to maternity leave. Thus, sums payable to an employee by way of wages or salary are the definition of remuneration.

Philip Hammond: That seems a very sensible definition, so why is it not built into the Bill?

Alan Johnson: I do not know, but I will think about it and get back to the hon. Gentleman, who makes a fair point.
 On self-certification and notice, the hon. Gentleman asked whether a standard form would apply. Subject to consultation, we intend to provide not a standard form but a model or guide for people to use. A standard form under the usual bureaucratic arrangements is unnecessary, but we shall offer a model certificate, which we will discuss with employers' groups. 
 I was asked about the use of regulations on a week's pay. We expect to make some provision for maternity and paternal leave under regulation 22, but a week's leave may not count to determine average pay for the purposes of the clause.

Philip Hammond: The Minister makes an interesting reference to regulation 22. Does he have a set of draft regulations in front of him, to which the rest of the Committee is not privy?

Alan Johnson: I hope not. As I said in the debate on amendment No. 146, regulation 22 of the Maternity and Parental Leave etc. Regulations 1999 provides for how many weeks of leave are relevant for the purposes of calculating a week's pay for an employee. The amount arrived at in this way is used in calculating redundancy or unfair dismissal compensation and for various other purposes. We intend to mirror that provision in existing legislation. If any draft regulations pertaining to the clause were available, I would be pleased to see them. I hope that I have answered all seven questions.

Philip Hammond: What of the penalties under new section 80C, 80D and 80E? I asked the Minister whether failure would be met by a financial penalty.

Alan Johnson: I cannot remember at the moment what ideas we have for introducing penalties. I shall think further on the point for a second. The hon. Gentleman is asking what penalties will apply if the provisions are not carried out.

Philip Hammond: While the Minister is thinking about that, I remind him that I asked about paragraph (f) of proposed new section 80E. What modifications will be required to chapter 2 of part 14 in respect of the calculation of a week's pay?

Alan Johnson: If an employee claims that he is entitled to or takes paternity leave when he is not entitled, any penalty would be a disciplinary matter for his employer, which is a sensible way of addressing the point. On new section 80E, I think that I just provided an answer, which is regulation 22 of the Maternity and Parental Leave etc. Regulations 1999.

Philip Hammond: I am still a little curious. Do we deduce from the Minister's reply that no offence is committed under new section 80E(c) and (d) by failure to produce evidence, keep records or comply with other procedural requirements? Clearly no offence is committed by failure to give a notice, but is there an offence in failure to act in accordance with a notice
 under paragraph (d)? I had anticipated that the Minister would say that an employer who failed to comply with some procedures would be subject to a penalty. Is that not the case? If we are talking merely about internal disciplinary procedure, why will regulations prescribe the consequences of such failures? Would that not be a matter only for the employer and employee?

Alan Johnson: There will be no offence in respect of leave, although there will be penalties in respect of pay.
 Question put and agreed to. 
 Clause 1 ordered to stand part of the Bill.

Clause 2 - Statutory paternity pay

Philip Hammond: I beg to move amendment No. 123, in page 5, line 31, leave out 'or has been'.
 This is a probing amendment. Is the inclusion of ''or has been'' intended to create an obligation on an former employer, or is the language merely designed to fit the tortuous language of the Social Security Contributions and Benefits Act 1992, which expects that someone who has gone on leave for two weeks has ceased to work for an employer? That is not my understanding of the term. Is there any substance to the wording, or is it merely designed to comply with the architecture of this part of the Bill?

Alan Johnson: No, there is no substance to it. In fact, the amendment would make it crystal clear that former employees, as opposed to current employees, would not benefit from the right to pay. That is the correct approach. If an employee leaves his employer many weeks before his paternity pay period—he might have given notice, but then leaves to start a new job or just leaves—it is not right for his previous employer to be obliged to make provision for that payroll relationship when the rest of the relationship has been cut asunder.
 The amendment suggests that it might not be clear from the Bill that that is what we intend. I am not sure whether the phrase marries up with the language in the 1992 Act, but if there is any doubt that we have not conveyed the correct intention—I have a few qualms about it myself—we will examine it carefully.

Rob Marris: Will my hon. Friend reconsider lines 44 and 45 on page 5, which are the reason for use of the past tense in line 31? If the Minister has a moment to examine that, it might show why the phrases that the hon. Member for Runnymede and Weybridge wants to remove are in the Bill.

Alan Johnson: I accept that, but it is part of the problem. The idea could be conveyed that once the employee has left employment, the employer still has an obligation for statutory paternity pay. We need to re-examine that, and the amendment or something similar may be needed. We want to be absolutely sure that we are not creating problems in other areas,
 particularly the legislation that the hon. Gentleman mentions. I hope that he will withdraw the amendment.

Philip Hammond: The legislation that I mentioned is the Act into which we are inserting the clause: it is not some different legislation. As the Minister says, the problem is that the Social Security Contributions and Benefits Act 1992 uses peculiar language that regards someone enjoying a period of statutory leave as someone who has ceased to work for an employer. That might pass muster if we are talking about maternity leave, which is quite long, but it is absurd and misleading in the case of a two-week period of paternity leave. No one would describe someone taking two weeks off as having ceased to work for an employer. To make it a condition of eligibility for statutory pay that one must have ceased working for the employer, meaning sitting at home rather than the workplace, is arcane drafting language obscuring the intended purpose.
 The Minister said at the beginning of his remarks that the amendment makes the Government's intention crystal clear, which differs in tone from his usual opening response to amendments. I would have thought that the amendment might commend itself to him. If we are all on the same wavelength as to what the clause is supposed to say, he might consider whether it actually does say it, and return with an appropriate amendment on Report. If he does not think it is necessary, we may do that.

Alan Johnson: We shall consider that. Maternity leave is a different situation altogether. A woman who has left employment is entitled to continue receiving maternity pay, so there is a difference between that and paternity leave, for all sorts of reasons that I will not go into.
 We have to be sure about the language. I commended the amendment because it would be wrong to say that it has a drafting fault. We need to be sure that we have dealt with the issue. If not, we will either table the hon. Gentleman's amendment, giving him the credit and royalties that he deserves, or a similar amendment that will clarify what we are saying. He has put his finger on a very genuine concern.

Philip Hammond: I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 130, in page 5, line 32, leave out from ''conditions'' to end of line 11 on page 6 and insert:
''for leave under section 80A of the Employment Rights Act 1996 he shall be entitled in accordance with the following provisions of this Part to payments to be known as 'statutory paternity pay'.''

Derek Conway: With this it will be convenient to discuss the following amendments: No. 124, in page 5, line 44, leave out
''ceased to work for the employer''
and insert: 
''exercised his right to take leave under section 80A of the Employment Rights Act 1996''. 
No. 131, in page 6, line 14, leave out from ''conditions'' to end of line 3 on page 7 and insert: 
''for leave under section 80B of the Employment Rights Act 1996 he shall be entitled in accordance with the following provisions of this Part to payments to be known as 'statutory paternity pay'.''

Philip Hammond: The amendments deal with the complex architecture of the Bill. I hope that the Committee will bear with me if it does not seem crystal clear at first. Amendment No. 130 deals with the perceived problem in relation to new section 80A. Amendment No. 131 deals with the same problem in relation to new section 80B. New section 80A provides that regulations will determine various factors, such as the number of weeks of continuous employment that entitle an employee to statutory leave. New section 171ZA cites in subsection (2)(b) a requirement of 26 weeks. The regulation made under new section 80A may not say 26 weeks. My understanding was that the statutory paternity pay regime was intended to mesh exactly with the statutory paternity leave regime, so that someone entitled to statutory leave would be entitled to statutory pay, except where he was below the earnings threshold, should the hon. Gentleman's amendment not be successful. In most circumstances, the two regimes would operate in a similar way.
 However, new section 80A leaves regulations to determine the number of weeks, whereas new section 171ZA specifies the number, so we could have a difference between the two regimes. The Minister will no doubt say that he intends to make a regulation under new section 80A that specifies 26 weeks. That is fine, but the fact that secondary legislation could change the reference in one section but not the reference in the corresponding section about pay shows that the drafting is not perfect. 
 Instead of referring to the 26-week criterion for eligibility for pay, the Bill should refer to the period specified in regulations under new sections 80A and 80B, so that there is always perfect symmetry between the two, whatever the regulations made under those sections might say from time to time. 
 Amendment No. 124 relates to a slightly different point. New section 171ZA(2)(c) uses the phrase ''ceased to work''. In a way, we have had this debate already, but I find that language thoroughly misleading. I understand that it is in the Bill simply because of the historical architecture of the legislation. However, it is clear that someone in the circumstances under discussion has not ceased to work for the employer; he has simply exercised the right to take leave. It is rather dangerous to go down that route, because in every normal sense of the word the person continues to work for the employer and is merely resting during two weeks of statutory leave. 
 If I am missing something, I am certain that the Minister will tell me, but notwithstanding the horrible language of the underlying Act, it would be sensible to remove the phrase 
''ceased to work for the employer''
 and insert instead
''exercised his right to take leave under section 80A of the Employment Rights Act 1996''. 
That would be entirely clear. 
 The Minister might even think about tabling an amendment or new clause later that would clarify the matter wherever the Employment Rights Act uses the phrase ''ceased to work'', if it is misleading. That would make a clear distinction between the separate cases. The Minister gave an example whereby, under the maternity regime, someone who had genuinely ceased to work for an employer would be eligible for maternity pay. However, under the envisaged regime, no one who has ceased to work in the everyday sense of the word will be entitled to paternity pay, but someone who has merely exercised his entitlement to leave will be so entitled.

Alan Johnson: These pretty large amendments would delete several pages of the Bill at a stroke and put a single sentence in their place. Are we debating the group that includes amendment No. 124?

Derek Conway: Let me help the Minister. We are debating amendments Nos. 130, 124 and 131, which relate to clause 2 and pages 5 and 6 of the Bill.

Alan Johnson: I thought that the amendments related to pages 5 to 8, but there may be a misprint somewhere.

Philip Hammond: I am looking at the amendment sheet, and I am confused. The amendment that I thought I was speaking to may be different from the amendment that I have actually spoken to. Did someone say something about a misprint?

Derek Conway: Apparently, on the original amendment paper it was page 8, but on today's paper it is page 6. The page number depends on the version you are working from. I shall find out why that has happened; I am sure that there is an explanation. Is the Minister happy with that?

Alan Johnson: I am not sure whether I should reply to the hon. Gentleman's point.

Derek Conway: We could move to amendment No. 124 and come back to amendment No. 130 later, if the Committee agrees; it is slightly out of order. Shall we do that? It would probably make sense.

Alan Johnson: It may be helpful if I go back. The amendments are pretty large; they delete two pages of the Bill. Superficially, that is attractive—I am all for cutting the size of the Bill—but the attempts of the hon. Member for Runnymede and Weybridge to simplify life might complicate it.
 The amendments address an issue that is relevant to existing maternity rights and to the new paternity and adoption rights. We have separate legislative regimes governing entitlements to leave and entitlements to pay. The amendments would harmonise definitions and eligibility criteria for paternity rights such that the Bill's provisions for leave would also serve for pay. If the hon. Gentleman's point is that life would be much simpler with one set of provisions in primary legislation dealing with both pay and leave issues, I 
 would say amen to that. However, the task of getting from where we are now to where we might like to be will not be simple; it certainly will not be as simple as the amendments imply. 
 It is worth repeating that our starting point in designing the new paternity and adoption regimes was existing maternity rights. There are reasons why maternity pay is currently covered by social security law—that is where first it came from—and why it operates with the definitions and concepts that are appropriate in that area. It is of fundamental importance that the social security system should provide for the needs of new mothers in a range of situations, not just for those who qualify for leave. 
 There are health and safety arguments for allowing women to take time off work after the birth of a child; they are a key reason for the existence of maternity allowance. Statutory maternity pay plugs into the same concerns, and legislation on maternity pay, maternity allowance and several other benefits necessarily and rightly interconnect at many points to ensure full protection for mothers. It would be difficult and delicate, if not impossible, to take maternity pay out of the social security nexus in which it sits and move it elsewhere. 
 Employers deal with maternity payments through their payroll for those women who are ''employed earners'' for other pay administration purposes, such as national insurance contributions. In practical terms there may be little difference between an ''employed earner'' for pay purposes, and an ''employee'' for the purposes of time-off rights under employment law, but they are technically different. It would be possible to harmonise definitions so that employment law, social security law and tax law operated with the same concepts and definitions, but it would be hideously complex.

Philip Hammond: I should clarify that the amendment would not delete several pages of the Bill. It would remove the large part of new section 171ZA. That new section defines the conditions that have to be met for entitlement to statutory paternity pay. I suggest that the entitlement should be defined in the Social Security Contributions and Benefits Act 1992 by reference to the Employment Rights Act 1996. Someone entitled to a period of statutory paternity leave should be entitled to statutory paternity pay during that period. Referring to the definitions in the other Act is a neat way of ensuring symmetry without further complications. The amendment was designed to address that.
 The Government intended that a person entitled to statutory paternity leave would be entitled to statutory paternity pay with the exception of those who fall below the lower earnings limit for national insurance contributions. If that is not the case, and the Minister envisages other groups who are entitled to leave but 
 not pay, it would be useful if he could explain who they are. I apologise, Mr. Conway, I forgot that that was an intervention.

Alan Johnson: The hon. Gentleman is right: there are no other groups. Those who receive statutory paternity leave will be entitled to statutory paternity pay. I hope we are not talking to different amendments. We want to mirror the maternity leave provisions. That is the philosophy behind the clause.

Philip Hammond: The Minister raises an important issue, and I have suffered from self-doubt because of the confusion about the reference. There will not necessarily be payments of statutory paternity pay to those entitled to statutory paternity leave. The Bill says that in order to qualify for statutory paternity pay, one must have spent a continuous period of at least 26 weeks with the employer. In relation to statutory paternity leave, that continuous period is to be defined by regulations. It might be defined as 15, 10 or five weeks, in which case a class of people would qualify for statutory paternity leave but not for statutory paternity pay. I invite the Minister to define the qualification for statutory paternity pay as being the qualification for statutory paternity leave by referring to the regulations under new section 80A.

Alan Johnson: The qualification is that they have worked for 26 weeks for employer, into the fifteenth week before the birth of the child. That is the qualification that we intend to apply to leave, which also applies to pay. I may need to consider the hon. Gentleman's point. He seems to be suggesting that the current drafting would mean—

Philip Hammond: Could.

Alan Johnson: It could mean a disparity between the two because one is in regulations and the other is in the Bill. I will consider if the clause does meet the agreed objectives and return with an amendment if necessary.

Philip Hammond: Unless I am missing something blindingly obvious, that is precisely the problem. I can understand why the Government might be blind to the problem because they know their intentions for the regulations. If they intend to make a regulation that stipulates 26 weeks, there will be symmetry with that in place. However, it is undesirable that two things are meant to mirror each other, but one is defined in regulations that can be changed by statutory instrument and the other is set in stone in the Bill. The same applies to new section 80B. I ask the Minister to let me know the outcome of his deliberations.
 The Minister said that he would consider the reference to 
''a person who is, or has been, an employee''. 
Will he also address the question of the ''ceased to work'' issue?

Alan Johnson: Yes, I said that we would consider that. The phrase has been used because it mirrors the language in maternity legislation, and it will be discussed as part of the exercise to which I have referred.

Philip Hammond: I look forward to hearing the outcome of that examination. I beg to ask leave to withdraw the amendment.
 Amendment, by leave, withdrawn.

Kevin Hughes: I beg to move amendment No. 91, in page 6, leave out lines 1 to 6.

Derek Conway: With this it will be convenient to take the following amendments: No. 92, in page 6, leave out lines 29 to 32.
 No. 90, in clause 4, page 15, leave out lines 9 to 12.

Kevin Hughes: The hon. Member for Runnymede and Weybridge will be grateful for a pause in his deliberations. He has been a one-man show for the past two sittings and for most of this one, except for the amusing intervention this morning from the hon. Member for Hertford and Stortford (Mr. Prisk). He has obviously frightened the Liberal Democrats away. We had one Liberal Democrat this morning, and now we have none. It is usually the case with the Liberal Democrats that the lights are on, but no one is home. The hon. Gentleman's Conservative colleagues seem to have been very quiet during these sittings. I wonder if they think that they are in government and are supposed to sit quietly. Government members have made more substantial interventions than Conservative or Liberal Democrat Back Benchers.
 I welcome the new rights afforded to parents in the legislation. Paid paternity leave and adoption leave are welcome and are a significant move forward in bringing families together at a crucial time. The Minister will recall that I raised the issue covered by the amendments on Second Reading on 27 November 2001. The Secretary of State acknowledged that the issue was important and should be considered in Committee. I have therefore tabled the amendments so that we may examine the exclusion of a particular group of people. I want to flag up the problems and give the Minister the opportunity to reconsider that exclusion, to question its fairness and hopefully to make suitable modifications to the Bill at a later stage. 
 The Minister has been probed from the front by the hon. Member for Runnymede and Weybridge and is now being probed from behind by Government Members. I find it difficult to believe that the Government, in proposing new and welcome rights for parents, are excluding a group of people who may need more help than most. The Government, more than any other, have gone out of their way to deal with social exclusion. The Prime Minister set up a social exclusion unit within months of coming into office to try to redress the balance to give those who are not so well off better opportunities. To date, their recommendations are bearing fruit in terms of getting funding into communities and specific projects where it is needed to help people out of poverty. 
 The buzz phrases when we first came into government were ''off benefits'' and ''into work''. Well this group of people are off benefits and are work. They are, however, in work that attracts only a low level of 
 income that falls below the lower earnings limit. There are various reasons for that and I shall come back to them in a moment. 
 The question is what message this specific exclusion from new rights is sending to those who have jobs but whose income is below the lower earnings limit. Is the message different for those not so well off? Is it that what is good for those who have well paid employment is not necessary for those who are poorly paid? Do those on lower incomes not count? Does the Minister think that they are less concerned about their children than those who are better off? I do not believe that that is the case. 
 The Minister needs to explain why he specifically excluded them from these new rights and on what grounds he thinks this exclusion would stand scrutiny under the terms of the European convention on human rights. The concept seems to be that just because someone is in a low paid job they do not need to spend time with their new baby or caring for their partner. The very idea is bizarre, but that is the only conclusion that people will draw from the unfortunate wording of this Bill. 
 There could be many reasons why incomes fall below the lower earnings limit. People may be unable to find one full-time job and so have more than one part-time one. That is often the case, and many people fall into that category. Many employers, particularly in the service sector, are only looking for part-time employees. The problem is that unless they earn over £72 a week from one job, they will fall below the lower earnings limit and, unlike the tax system, national insurance is levied on income from each job separately. 
 It could be that because of a disability a person is able to hold down only a part-time job, perhaps getting disabled person's tax credit. If they are on a minimum wage, they could work 17 and a half hours and still fall below the lower earnings limit. People between 18 and 21 who do not get the minimum wage—they might be on £3.50 an hour—would have to work over 20 and a half hours a week before they exceeded the lower earnings limit. 
 There are many people who work low basic hours, for example in the service sector or the retail sector. There are many people whose work is seasonal, particularly in tourist and agricultural areas. They may find it easy to get work at peak times but very difficult to find full-time work at other times. During such times, they will fall below the lower earnings limit. 
 None of these people is any less hard working or deserving than many of us who are lucky enough to have full-time, well paid employment. Clearly, to exclude such people is grossly unfair and discriminatory and I cannot believe that the Minister is happy in promoting such discrimination, particularly given his extensive experience of fighting against such unfairness and obvious discrimination before he was elected to the House. 
 I urge him to review this situation. These amendments are not radical. People on any level of earnings are already entitled to paternity and adoption leave. These amendments simply extend the right to payment for the period of the leave to the lowest paid 
 people in this country, to ensure that they can all spend some time with their children at the important time at the start of their lives. Children who are born and brought up in poverty suffer too many disadvantages already. The strains on their family lives are perhaps the greatest. I urge my hon. Friend to take this opportunity to make one more step towards redressing the balance.

Helen Jones: I support my hon. Friend the Member for Doncaster, North (Mr. Hughes). I do so on two grounds: first, on the grounds of basic fairness and, secondly, because the thrust of the Bill goes against the whole thrust of Government policy elsewhere. When I look at the clauses I think of the many people in my constituency and those of my hon. Friends who struggle to hold down two or three jobs just to keep their heads above water. That applies to some men, but particularly to many low-paid women workers who juggle several different jobs to keep their families afloat.
 As my hon. Friend said, such people are extremely hard working. In some ways it would be much easier for them to accept a life on benefit, but they choose not to do so. For us to deny them paid adoption or paid paternity leave is profoundly discriminatory. These people will not have savings to fall back on to tide them over a period of unpaid leave. They struggle to get by from week to week. To say, as the Bill appears to say, that they are less entitled to the right to be with their children than those on higher incomes is not only profoundly unfair but goes against the whole thrust of the Government's policy of ending social exclusion and trying to support families who are in poverty or disadvantaged in other ways. 
 Why do we as a Government promote programmes like Sure Start in deprived areas to encourage families to give their children the best possible start in life and yet at the same time deny them paid adoption or paternity leave? That is not right. If we are encouraging people to take jobs that are often low paid as a step to further work we should not build profound disincentives into the system. By working in low-paid jobs these people save the Government, the community and indeed all of us, money that would be paid out in benefit. They are often the people whose children deserve the best start in life and we should encourage that by ensuring that they get the same paid leave entitlements as anyone else. 
 I hope that my hon. Friend the Minister will think again about what is in the Bill and accept the amendment, otherwise I do not see how we can defend the clauses. I do not see how we can say that we support family-friendly policies and encourage those who are socially excluded to give the best possible start in life to their children and to break that cycle of deprivation and poverty if we do not give them the wherewithal to do so.

Tony Lloyd: I welcome the amendment and congratulate my hon. Friend the Member for Doncaster, North on tabling it. This is an important debate. Throughout the debate on clause 1 and our brief debate so far on clause 2, the hon. Member for Runnymede and Weybridge and the Minister have paid strong tribute to the need to introduce paternity pay so that we respect the proper role of parenting in modern society. Both Front-Bench spokesmen have waxed eloquent about that need: I have no quibble there. However, at no point do I remember the words ''except where poor families are concerned'' being used. We must recognise that the warm words that were expressed about the benefits and advantages of parental leave, which is an opportunity for people— especially fathers—to spend time with their newly-born children, should apply to families at the bottom end of the income scale.
 I represent a disproportionately poor constituency, and hon. Members on both sides of the Committee could say the same. A significantly high number of families in my constituency would benefit were the amendment passed. The figures show that at the time when the woman in the family is pregnant, an average of 3,500 families per constituency will gain through the amendment. In my constituency, the figure would be significantly higher. A young child born in the poorest part of my constituency suffers massive disadvantage compared with a child born in Runnymede and Weybridge or other prosperous parts of the country. 
 I am not condemning the constituencies of Conservative Members, but children born in my constituency will do worse at every stage of their life. Their health will be worse from birth. They are more likely to die at the time of birth, they will suffer worse health throughout their life, they will suffer worse educational and social opportunities and they will die younger. If active parenting, particularly by the father, can make a contribution to push those disadvantages back a little, we should recognise the need for parental leave. We should certainly recognise the advantage of that form of economic support: the moral and the practical cases run entirely in the same direction. There is no argument on a moral or practical basis in drawing a distinction between families who are better off and those on lower incomes. 
 When the Department of Trade and Industry gave reasons for the cut off during the consultation, it argued that because the period of paternity leave is limited to two weeks, it would be difficult to justify setting up an equivalent system to administer the payment of paternity leave to fathers whose weekly earnings are below the limit for the payment of national insurance contributions. In fact, it is difficult not to justify that, for the reasons that my hon. Friends have put forward. It is difficult to justify failing to provide economic support to those at the bottom of the ladder who need it more than the better off. That is a matter of practical fact.

Judy Mallaber: I agree with the arguments of my hon. Friends the Members for Manchester, Central, for Doncaster, North and for Warrington, North (Helen Jones). There will have to
 be a system in place to carry out calculations for those who earn more than the lower earnings limit—90 per cent. of average earnings. It is hard to understand why it is reasonable to grant money and administrative effort to implement the system for those above that limit but not those below.

Tony Lloyd: My hon. Friend makes a fair point, which moves me in the direction that I was going anyway. Will the Minister tell us what is the administrative difficulty and insurmountable bureaucratic hurdle that would cost so much? Around 600,000 males fall below the income limit. If we worked on the basis that one twenty-fifth of those were in a relationship in which the wife gave birth, that would mean about 24,000 or 25,000 cases a year. If we were to use the 90 per cent. limit of £72, that would mean £80 a week or £160 for the maximum fortnight's leave. I am not sharp enough to work out the conclusion with my own mathematics, but I believe that it leaves about £350,000 or thereabouts that the Treasury would have to pay out in direct costs, which is a relatively trivial sum of money.
 There might be bureaucratic costs but, as was noted, they will be borne for groups slightly above the level so what is the major problem? If there is an issue around the individual cases, I am sure that imaginative systems could be brought to bear. We could pay them a flat rate and not worry about the 90 per cent. I cannot speak for my hon. Friend the Member for Doncaster, North, but I would agree if the Minister proposed paying a flat rate of £70 a week instead of using the 90 per cent. figure. My hon. Friend nods; he would agree too. It would be a straightforward, easy-to-administer lump sum, so there are ways round the administration that would make it simple. It might be a bit of rough justice, but nothing like the rough justice that would come by excluding the group altogether. 
 I appeal to my hon. Friend the Minister to give us some comfort today and assure us that the Government are heading in the right direction. We need to know that the Minister and Government are as consistent in protecting those most vulnerable in our society in this legislation as they are in so many other aspects of Government policy. 
 I hope that the hon. Member for Runnymede and Weybridge will offer his support to the principle that lies behind the amendments. If he does not, all the fine words that we have heard during the many hours for which he has spoken in his rather extensive attempt to clarify the Bill will mean nothing. This new caring, sharing Conservative party, of which we have seen a little, would be exposed as bogus, so I hope that he will make it clear that the Conservative party will support the change. 
 I should like to make the same comments to the Liberal Democrats but this particularly important debate for protecting those on the lowest incomes in our society interestingly sees them elsewhere. They might have much more important or interesting topics to debate. It is not for me to decide their priorities, but I know that the priorities of urban Liberal Democrat 
 councillors in areas such as Manchester and Sheffield are not matched by the disinterest of the parliamentary party in today's debate.

Philip Hammond: Has it occurred to the hon. Gentleman that the Government Whip might have had a word with the Liberal Democrats and that might explain their absence in view of the gathering clouds behind him?

Tony Lloyd: My hon. Friend the Government Whip is a man of much greater sophistication than that, which is why he still counts me as a friend despite the fact that I sit some places behind him. The Liberal Democrats' absence at this stage of proceedings is not easily excusable, and they must account for it themselves.
 Having placed that on the record, I urge my hon. Friend the Minister to examine the genuine concern about and lack of comprehension of an approach that abandons those families who are in greatest need of such Government assistance. He could improve the good work in providing paternity pay and paternity leave, for which he is entitled to claim credit, if he said that he would go a step further and look for an imaginative administrative solution that would allow the lowest paid to benefit from that pay.

Joan Humble: I did not intend to speak, but the compelling words of my hon. Friend the Member for Doncaster, North reminded me that women are not the only low-paid earners. Many men earn less than the lower earnings limit. In my constituency in Blackpool, many people who are employed in the tourism industry and do seasonal work regularly have two or three jobs to make a living for their families, but they do not earn enough in one job to go over the lower earnings limit. I am concerned about those people.
 Listening to my hon. Friend, I was also reminded of an excellent report that was produced in the last Parliament by the Select Committee on Social Security, of which I was a member. That Committee considered the implications of paid parental leave in the context of the Government's accepting the need for unpaid parental leave. Much of the evidence that we took from a variety of groups concentrated on the low paid. We were told that many people with higher earnings received paid parental leave in any case. Men received paid paternity leave because they had good agreements with their employers. The low paid were the worst off. 
 We took compelling evidence from a wide variety of sources, including some from the United States Government, that men who earned below certain amounts did not take unpaid parental leave because they could not afford to do so. The Committee recommended that the Government introduce a flat rate for paid parental leave, so I am pleased that they are doing so. 
 I was also pleased that when the Committee produced the report, the Government acknowledged the particular needs of low-paid workers by enabling 
 low-paid families to claim income support during periods of unpaid parental leave. A question therefore arises. The Government recognise that those families need additional support and that fathers need to be paid to stay at home to look after their young children and share the caring responsibilities with their partners. There is clearly an administrative cost to processing claims for income support, so I wonder how that would compare with the administrative cost of giving those men paid paternity leave rather than requiring them to claim income support. Why should those poor families have to claim income support when everyone else receives paid paternity leave? The issue is clearly complex, and I fully welcome the moves that the Government have already made. Certainly through the social security system, they have recognised low-paid workers' needs. 
 I urge my hon. Friend the Minister to consider the issue again to see whether there is a way to enable those fathers to qualify for paid paternity leave under this system. I hope that he will consider the barriers in the proposals and perhaps overcome them for the benefit of my constituents and many others throughout the country.

Hywel Williams: I welcome the amendments. It has long struck me as rather peculiar that under parts of the income maintenance system and the social security system, people who are too poor to access payments are denied them. The social fund springs to mind, under which people are denied loans because they are too poor to pay them back. A more pertinent example might be the lower-sum rule that prevents people from accessing grants. It is alleged that people are not allowed grants or loans below £30 because the administrative costs of the payments would be too high.
 Like Labour Members, I have many people in my constituency who have part-time jobs and do not reach the lower earnings level. The reasons that they work part time are often structural. In marginal economies in rural or tourist areas such as mine, many people who wish to work full time have to take part-time jobs—or several part-time jobs, to reach a reasonable income. I support the amendments, and I urge the Minister to consider my points.

Judy Mallaber: I wish to add a point to the excellent contributions made by previous speakers and urge the Minister to reconsider the amendments and the point just raised about the prevalence of part-time workers who fall below the LEL. My hon. Friend the Member for Doncaster, North gave various explanations as to why people might fall below the LEL, including low basic hours and juggling several different part-time jobs.
 The Minister made an excellent appearance before the Employment Sub-Committee of the Select Committee on Education and Employment, of which I was a member in the last Parliament. We discussed the question of part-time workers' rights and the implementation of the directive. The Government put 
 forward proposals that later came into effect to end discrimination against part-time workers. I urge the Minister to consider the amendments in the light of the Government's agenda on that item. 
 My hon. Friend the Member for Doncaster, North spoke about consistency of Government objectives, specifically for social exclusion. Perhaps the Minister would consider the amendments in the light of our agenda on rights for part-time workers and people who work difficult, complicated hours and are finding it difficult to juggle different responsibilities. I hope that he will take that into account and try to remedy what would be a great injustice.

Rob Marris: I join my colleagues in urging the Minister to reconsider the amendments. I also raise a point that I confess I do not understand; it is more technical. Would someone who has three part-time jobs, each paying £60 a week, be eligible for paid paternity leave? Each job provides earnings below the LEL, but cumulatively they would be over the LEL. The way the clause is worded, it appears that he would be eligible, although that does not seem to be the intention and is not what the Union of Shop, Distributive and Allied Workers is saying.

Philip Hammond: I shall speak briefly, because Government Members have made many points, and the Minister has enough on his plate without me adding to it. I noticed that none of the speakers mentioned trade union membership. A published agenda of the Trades Union Congress is the removal of the exclusion of people earning below the lower earnings limit. I would like to ask the Minister a few questions for clarification.

Tony Lloyd: What exactly is the hon. Gentleman's point? Several of my colleagues and I have made it clear where our trade union loyalties lie. That is well known; it is not a secret. Is the hon. Gentleman saying that because an issue is espoused by a trade union, anyone who has an association with a trade union is debarred from speaking on it? For example, I represent poor people. Am I debarred from speaking about low pay because I chair the parliamentary trade union group? Is that what the Tory party really thinks about trade unions?

Philip Hammond: With the greatest respect to the hon. Gentleman, I must say that he is talking nonsense. I have not suggested that he should not speak on those matters. However, on Second Reading, many hon. Members felt it appropriate to declare membership of an organisation that had a certain published agenda.

Kevin Hughes: On a point of order, Mr. Conway. I am a member of a trade union. As far as I am concerned, that involves no pecuniary gain. In fact, I pay the union; it does not pay me. It beggars belief that I should have to declare that I am a member of a particular trade union to debate this important issue. Will you give guidance on that, Mr. Conway?

Derek Conway: Order. The point of order is fair. Hon. Members must decide whether they have pecuniary interests to declare, and it may help
 Committee Members to know that if they receive outside remuneration for whatever purpose, that does not prevent them from taking part in the discussion. However, the House authorities would probably expect them to make that declaration before they contributed to the debate. I hope that that reassures hon. Members about their rights and privileges.

Tony Lloyd: Further to that point of order, Mr. Conway. In practical terms, that means that no member of a trade union needs to bother about that frivolous point. However, an interesting point arises on which you may want to rule, Mr. Conway. Would those who declare themselves to be employers have to state whether they pay their employees below the lower earnings threshold?

Derek Conway: Order. Neither the House authorities nor the Registrar of Members' Interests have taken a view on that. Hon. Members must decide what they want to make known to the House in the fullness of their contribution.

Philip Hammond: If I were opposing an amendment that sought to remove entitlements below the lower earnings level and I were an employer, which thankfully I am not, I would feel it incumbent on me to make that fact known. The hon. Member for Manchester, Central is reading too much into my comment. I merely wanted to make it clear to the Committee that this perfectly legitimate issue is part of the policy agenda of the TUC. Neither the hon. Gentleman nor other hon. Members can be surprised that the question should arise whether trade union membership is relevant, because without exception every Government Back Bencher who spoke on Second Reading thought it appropriate to declare membership of a trade union, and there is nothing wrong with that.

Judy Mallaber: Does the hon. Gentleman accept that I pointed out my relationship with Unison, for which I worked for several years many years ago, to show that I have considerable experience of working with part-time workers on employment rights and conditions at work? That is relevant to my being able to speak on the subject, as is the fact that there are many low-paid workers in my constituency. Would the hon. Gentleman regard that as relevant experience that is declared to show that I have some expertise, rather than to show that I have some strange agenda?

Philip Hammond: We have all become sensitive to the declaration of interests, and rightly so. However, the purpose of that issue is transparency, as I understand your guidance, Mr. Conway, so that people listening to a debate or reading Hansard can understand what outside influences are driving what hon. Members say. That is reasonable. I am surprised that Government Members are so prickly about my comment.

Judy Mallaber: It is what was implied.

Philip Hammond: I assure the hon. Lady that I did not imply anything, but was rather surprised that none of the Government Members chose to mention the TUC's campaign.

Alan Johnson: The hon. Gentleman mentioned to Mr. Amess on a point of order that although on Second Reading the Speaker had made a comment, most people declared an interest. I declared my membership of the Communication Workers Union, and many Labour Members declared their membership of a union. The hon. Gentleman said this morning that he had not declared membership in Committee, and if he had committed any offence by doing so he apologised retrospectively. However, he is surprised that Government Members who did the same on Second Reading did not declare union membership in this debate. That is a contradiction.

Philip Hammond: I told Mr. Amess that I had not repeatedly declared the same thing at the beginning of each debate, which, as the hon. Member for Doncaster, North who moved the amendment noted, would have meant that I said the same thing over and over again. I declared my interest at the outset of the Committee. I have not declared it on each occasion that I have spoken, and on reflection, the Minister may be glad that I have not taken up the Committee's time in that way.
 I should be grateful if the Minister could provide some factual information. An important point has been raised. We seek to address issues of family breakdown, and the social behaviour that arises from inadequate parenting for children. Clearly, the point that Labour Members have made is valid. It is not always the case, but surely it is the poorest people who are most often involved with families that are most vulnerable to such a situation? Those are the people at whom we should be targeting support. 
 I want to ask the Minister about the contributory principle. There are benefits that people receive as a result of contributing through the national insurance system. Can the hon. Gentleman identify precedents where payment of certain benefits is not made to people not making national insurance contributions? I also want to ask him about the costs that would be involved in accepting the amendment tabled by the hon. Member for Doncaster, North. I hope that the Government have estimated its cost to the Treasury. 
 I should also like the Minister to speak about the alternative forms of financial support that would be available to a person who is excluded as a result of the lower earnings limit threshold under the Bill. Will some people who are excluded be better off with the alternative provision for them that is available from public funds? I accept the question as to why some people should have to claim under another provision when others, on higher earnings, receive a statutory benefit as of right. I suspect that those people would be more interested in how much they receive than the route that they have to take in order to receive it.

Tony Lloyd: I used to think that the cost was about £300,000. In fact, £3 million would be a more accurate figure. In the case of maternity pay, those below the earnings levels are in receipt of benefits. There are examples of people who are not making contributions directly to the national insurance system receiving benefit.
 Does the hon. Gentleman believe that the spirit of the amendments is essentially just? I am not asking whether he supports them, but whether he believes that those below the earnings threshold should have access to paternity pay?

Philip Hammond: I am glad that the hon. Gentleman is not asking me whether I support the amendments. I might ask the same question of him and he might not wish to answer at the moment.
 The point that I was making before the hon. Gentleman's intervention was that what will matter most to the people in question is whether they will receive some money while taking paternity leave. Whether it is called statutory paternity pay or whether it is available to them through another mechanism may be less important to them. When we began our deliberations on this part of the Bill, I said that if we are addressing a problem and not merely giving leave rights and money to people for their benefit, but because we see a benefit to society in ensuring proper parenting, the group of people we are discussing now—probably more than any other group—could be a highly relevant target group for that kind of intervention.

Tony Lloyd: Was that a maybe?

Philip Hammond: No. Until I have heard from the Minister what other support will be available, I would like to reserve my judgment. I do not believe it as a grand principle that a person in certain circumstances should receive public funds under this rather than that heading. I look forward to hearing what the Minister has to say about that.
 The hon. Member for Doncaster, North said that he would be surprised if these provisions stood up to scrutiny under the European convention on human rights. That raises a wider issue about whether contributory benefits would generally stand up to such scrutiny. Of course the Bill includes a certificate from the Secretary of State stating that its provisions are compatible with the convention. 
 Apologies to members of the Committee who have heard me tell this story on another Committee, but one of my constituents is a stalwart long-term member of the Labour party and an academic lawyer. He opined in a book that a Minister who makes such a statement on the front of a Bill and is subsequently proved wrong by the courts should resign as having materially misled Parliament. Will the Minister convey that point to the Secretary of State? Interestingly, it is the same gentleman who mounted a challenge to women-only shortlists from inside the Labour party. [Interruption.] No, he is not a Tory mole, but very much a Labour party member.
 Some Labour Members argued that a disproportionate number of those caught by the lower earnings limit exclusion will be women. Has the Minister been advised on indirect sex discrimination? Other hon. Members may have detailed statistics, but I imagine that far more women than men would be caught by the provision. It will not be an issue for statutory maternity pay where we are dealing with a birth, but where are we dealing with adoptions the person in receipt of statutory maternity pay could be a woman. I look forward to hearing the Minister's response to interesting and important issues.

Charles Hendry: I had not intended to speak, but have been moved to do so in response to the eloquent contributions of Labour Members. They obviously focused on issues in their own constituencies, but it is a wider national issue. The Library recently published the gross domestic product statistics for local authority areas. East Sussex was revealed as the third poorest in the whole country. That is because it depends on tourism, retail, farming and small engineering companies for the main source of employment within the county area. Areas seen to be prosperous—often wrongly—can be affected as much as inner city areas.
 I shall not detain the Committee long because I want to hear the Minister's response, but I want to argue that certain groups of people will be inadvertently hit by this measure. A father who stays at home part-time to look after a disabled child or a son who looks after an invalid parent is classed as a carer and works fewer hours on account of it. If such people are working part-time on low wages, they could fall below the threshold. Similarly, a disabled person may fall below it because his ability to work a full week is impaired. 
 When I was in this place before, I was joint-chair of the all-party group on homelessness and enjoyed many hours of discussion with the hon. Member for Manchester, Central. I am still vice president of the Big Issue foundation. When one is trying to get people back into work who have been homeless one cannot expect them to go into full-time work straight away. There is a gradual progression as they work their way back, building up a few hours, starting on low paid work and getting better employment as they progress. Those who have been the most vulnerable people in society would fall foul of this measure. 
 The Bill specifically refers to the eight-week period. Someone's hours might have been cut for reasons such as economic downturn. They may have been earning well above the lower earnings limit but for that particular period of misfortune may fall foul of the measure simply because of an economic downturn. Finally, I should be grateful if the Minister would clarify what normal weekly earnings are. Does that exclude overtime? My assessment is that normal weekly earnings are the base income and so would not take account of overtime earnings. If someone has been off sick over that period it would bring down his earnings levels. There are many categories; it is not just people living in deprived areas. People who have 
 suffered all sorts of misfortune and difficult circumstances could suffer as a result of these measures.

Betty Williams: I welcome the points made by the hon. Member for Wealden (Mr. Hendry), particularly about people with disabilities and their carers? I am a member of the Select Committee on Welsh Affairs. Early last year we published our social exclusion inquiry report, which highlighted many of the points that have been made by my hon. Friends this afternoon. We met many groups in Wales who represented those people we have heard about this afternoon. Some of our recommendations have been quoted. I support my hon. Friend the Member for Doncaster, North and his amendment wholeheartedly.
 Like many hon. Members I welcomed the new deal programme that was set up immediately after we were elected in 1997. In my constituency we changed the whole culture of people who have been unemployed for a long time. We changed their thinking. They searched for work. Tourism is the major industry in my area and some of my constituents work for three different employers. In the beginning they had difficulty holding down one job, let alone three, to make ends meet. I urge the Minister to listen carefully to what we say this afternoon. I feel confident that he will give us the answers that we seek.

Mark Prisk: I do not intend to delay the Committee long. I should first like to reinforce the excellent comments made by my hon. Friend the Member for Wealden. May I also go back to the comments made by the hon. Member for Manchester, Central? While he is entirely right to demonstrate that his own constituency as an entity is poorer and worse off than Hertford and Stortford or Runnymede and Weybridge, it is important not to assume that that is uniform. The Sele Farm estate in Hertford has significant problems. Equally there are villages in my constituency that also have significant problems. In a funny way because there are fewer people in those circumstances in those communities they are even more isolated. That point is worth bearing in mind.

Alan Johnson: This has been a good debate. I congratulate my hon. Friend the Member for Doncaster, North. He has raised the matter consistently and he and other colleagues have been vociferous in their arguments—not because they are members of trade unions, but because they are worried about the same problems as us. I shall try to make our position clear.
 We have introduced these rights to try to help everyone who adopts a child or gives birth to a child. My hon. Friend is right to say that in terms of social provision it is particularly important to help lower-paid people who are raising children in difficult circumstances. We must ensure that we do not discriminate against the low-paid—there is no argument about that. I hope that those of my hon. 
 Friends who want me to remain consistent with policies that I have supported or introduced before recognise that the lower earnings limit does not exist only in relation to this Bill. I shall explain some of the issues about the lower earnings limit, then move on to how we think that we can resolve the problem. In due course I will ask my hon. Friend to withdraw the amendment, hopefully content in the knowledge that we are aware of the problem and are determined to resolve it, but think that this is the wrong way to do it. 
 Under the earning conditions attached to each of the three categories—payment of paternity leave, payment of paternity leave to adopting parents and payment of adoption leave—the employee's average earnings must be at least equal to the lower earnings limit, which will be £75 a week in 2002-03. I say to my hon. Friend the Member for Wolverhampton, South-West that if people work part time for three separate employers, the national insurance contributions system, unlike the tax system, does not aggregate that, so they would not qualify. If they worked in two part-time jobs for the same employer, they would qualify. They could qualify if they worked in different part-time jobs in parts of the same company or in a subsidiary of the same company, although there are a few blurred edges there. But if they worked part time for Tesco, Sainsbury and Asda—I am trying to pick a supermarket chain that does not have a politician involved—

Philip Hammond: You will not find one.

Alan Johnson: No.
 If they do that, they will not qualify. It is important to make that clear.

Rob Marris: I did appreciate that that appeared to be the Government's intention, but it is not what the Bill says.

Alan Johnson: That raises a whole new problem. My hon. Friend suggests that we have resolved one element of it, anyway. We believe that we have kept to the principle of the lower earnings limit as it currently applies, for reasons that I shall now explain.
 Amendments Nos. 91, 92 and 90 seek to remove the earnings requirement, whether in relation to a newborn child or a child newly placed for adoption. I share the concern that parents should benefit from financial support to take time off to care for their newborn baby or newly-placed child regardless of their income group. There is no difference between us on that. In the case of paternity pay, they should have the right to take additional time off to support the mother or adoptive parent. 
 Why is the lower earnings limit there? Obviously, the major element of the LEL is that people whose earnings are below it do not pay NICs. The clause inserts new text into the Social Security Contributions and Benefits Act 1992, which has the effect of ensuring that the criteria for qualification for statutory paternity and adoption pay are in this respect entirely consistent with the criteria for statutory maternity pay. We have been anxious wherever possible to ensure that all three systems run in parallel. The introduction of 
 statutory paternity and adoption pay is entirely new, and we tried to make them consistent with maternity measures for that reason. It is important that both employees and employers, who will be responsible for administering the schemes, find them as easy to understand and administer as possible. 
 The lower earnings limit exists for statutory and maternity pay for several compelling reasons, which include preventing disproportionate administrative burdens being placed on employers, who do not have to keep payroll records for people earning less than the lower earnings limit. That also applies to statutory adoption pay, and the need to prevent disproportionate administrative burdens falling on employers applies, arguably with even greater force, to statutory paternity pay.

Helen Jones: Government Members have been listening carefully to the Minister's remarks. With regard to maternity leave, if one falls below the lower earnings limit one gets maternity allowance, but there is no equivalent where paternity leave and adoption leave are concerned.

Alan Johnson: My hon. Friend makes an important point to which I shall refer, but I am discussing statutory and maternity pay. We had to find a different way in which to approach the issue, and we did not just take maternity pay and apply it across the board to people on the lower earnings limit. We introduced a different way of resolving the problem, namely the maternity allowance, and extended it to groups who were previously excluded, which explains why we are mirroring the provisions for statutory and maternity pay.
 The requirement for employers to keep detailed payroll records is not insignificant. My hon. Friends know that it is rubbish that we do not understand the burdens on business, which is why we took a proportionate approach to deal with the problem. In the Equal Opportunities Commission's response to the public consultation, it estimates that under the new scheme up to 5,000 fathers each year would qualify for paternity leave but not for paternity pay. The number of adopters qualifying for adoption leave but not for adoption pay is likely to be no more than 200 each year. The amendment would introduce new requirements for employers to keep records on all employees who earn less than the lower earnings limit, which would cover more than 2 million employees. If we adopt the amendment the only way around the issue would be to adapt payroll records covering 2 million employees because of 5,000 potential fathers and 200 potential adopters. 
 The hon. Member for Runnymede and Weybridge asked about the potential cost, which would not be especially significant for the Treasury, but that is not the point because as far as the Exchequer is concerned the money must be provided in some way. The potential cost to employers is difficult to gauge but, as hon. Members will appreciate from those figures, it could be horrendous.

Kevin Hughes: I have a simple question, but it may not be simple to answer. Will employers not already keep records for reasons such as the minimum wage, the working families tax credit, stakeholder pensions if they employ more than X amount of people or tax issues? I should have thought that the detail to which the Minister referred would already be there.

Alan Johnson: Not to assess the entitlement to statutory and maternity pay or to the statutory requirements under the legislation. We are discussing two different things: the records to which my hon. Friend referred and the records required to operate this scheme. The lower earnings limit is attached to national insurance contributions, so NICs determine the records that need to be kept.

Philip Hammond: I share the doubts of the hon. Member for Doncaster, North. Excuse my ignorance if I am wrong, but I find it difficult to imagine that there are classes of people whom one can employ and pay, but for whom one need keep no records. How, for example, does one demonstrate to the Inland Revenue that one is not supposed to be deducting contributions or tax on their behalf? In this day and age, the vast majority of employers use a computerised or mechanised payroll system, so they keep records for all their employees, whether or not they earn more than the lower earnings limit. Is the Minister saying that an employer who employs someone on the lower earnings limit is not required to keep payroll records for that employee? If so, I should be most astonished.

Alan Johnson: I am advised that, in relation to this particular payment, and certainly in terms of the working families tax credit and the national minimum wage—recent innovations that we have introduced—the records that employers will need to keep are not the same as those that they are required to keep to pay benefits under the NICs system to those who do not qualify for NICs.

Tony Lloyd: It is clear that, under the equivalent maternity provisions, those below the LEL qualify not for maternity pay but for maternity allowance. I suspect that my hon. Friend is right to say that the matter has been dealt with before, but I share the astonishment of other members of the Committee that we have been unable to devise a suitable system. Even if there are technical barriers to small firms employing such employees—I guessed that there are about 25,000 of them, but my hon. Friend's estimate is some 6,200—is it not possible to devise a system equivalent to maternity allowance that is operated through, say, the Benefits Agency? It surely would not be very expensive to administer, particularly given that we are talking about a self-certifying scheme.

Alan Johnson: The nub of the issue, which was central to the contributions of not only my hon. Friend but all members of the Committee, is how to tackle this problem, and that is the question to which I now turn.

Brian Cotter: I gathered from the Minister's comments that he intended to look at the adoption issue. As I have already explained to you,
 Mr. Conway, I had to be absent from the Committee due to an announcement of 300 job losses at Westland, in my Weston-super-Mare constituency. I am therefore largely unaware of what has been discussed, and I apologise publicly to the Committee for not having been here to debate a key issue. I did hear the Minister say that there are not many adoptions, but encouraging more adoptions forms part of the policy of ensuring support for children, and I shall listen with interest to his further comments.

Alan Johnson: The hon. Gentleman was kind enough to write to me stating that he could not be here because of an urgent constituency matter. I shall deal with his point, which has also been raised by other members of the Committee, but I should first point out that in respect of the working families tax credit, employers have no obligation to keep records for those who work fewer than 16 hours—precisely the group that we are talking about.
 I am not trying to be difficult, but I should be surprised if the burden were disproportionate in terms of the payroll argument. It was suggested that we introduce maternity allowance instead of statutory maternity pay, and I shall explore that issue. However, let us first consider whether we can find a different solution that imposes no burdens on small businesses, but which still ensures receipt of the necessary assistance. We consider that the most appropriate approach is to scrutinise the existing benefit system and ensure that it is geared up to work for low-paid fathers in respect of paternity leave. Those will include fathers earning just above the lower earnings limit who may otherwise receive less financial support during paternity leave than a father earning just below that limit. Support should be extended to fathers who are at the margin and earn only a few pounds more than the limit. 
 The Department for Work and Pensions is working on the detail of that to ensure that parents taking paternity leave, whether for a new born baby or a newly-placed child, have, as a minimum, the same access to benefits—income support, housing benefit and council tax benefit—as if they had taken parental leave. That requires changes to social security regulations such as extending the scope of income support to cover fathers on paternity leave. Although the precise level of income support that fathers receive will depend on individual circumstance, standard rates of income support for a couple will ensure a total income of at least £130 per week, which is in excess of the proposed rate of statutory paternity pay. The income support rules are a matter for the Department for Work and Pensions, and it will need to look at the details further, but we do not expect difficulties in securing an extension of income support rules on parental leave to introduce paternity leave. As that will involve amendments only to secondary legislations, it does not necessitate a change to the Bill.

Helen Jones: What would be the position of a woman who wanted to take adoption leave and whose partner was working? As I understand it, she will not qualify for payments under the income support regulations and will therefore lose out.

Alan Johnson: That is an important point, but I do not have an answer. I intend, with the involvement of hon. Members, to consider further such points at the end of this debate to find solutions.
 The situation for low-paid adopters who qualify for adoption leave, but not pay, is different. The right way forward is not to remove the lower earnings limit, but to ensure that low-paid adopters receive alternative financial support to help them benefit from the new right of up to one year's adoption leave. My colleagues in the Department of Health are actively working on plans of how best to provide low-paid adoptive parents with an appropriate payment equivalent to maternity allowance. That project is underway specifically to take account of the new changes and firm proposals will be produced early this year. Payment for adoptive parents will mirror, as far as possible, the eligibility requirement for maternity allowance and will give financial support to those with fragmented work patterns and the self-employed.

Philip Hammond: The Minister is doing extraordinarily well in explaining a complex area that is way outside his brief. It was obvious that there would be much interest in this matter, so can he explain why the Under-Secretary of State for Work and Pensions, the hon. Member for Croydon, North (Malcolm Wicks), is not here to answer questions?

Alan Johnson: Because I am doing it and that is how we are divvying up the Bill. My hon. Friend the Member for Croydon, North will be here to deal with issues that will have ramifications for my Department while I take the opportunity to do other things. I am dealing with the debate and it is not necessary to have another Minister beside me. It would also be unfair on my hon. Friend the Member for Croydon, North.

Philip Hammond: I accept that it is the Government's business how it divides up ministerial attendance in Committee, but the Minister has had to answer his hon. Friend, the hon. Member for Warrington, North, by frankly admitting that he does not know the answer to a good question. There is no reason why he should know the answer because he cannot be expected to have a grasp of everything that happens in the Department for Work and Pensions but, had the Under-Secretary of State for Work and Pension been here, the hon. Member for Warrington, North might have received an answer.

Alan Johnson: The only person who should be upset at my reply to my hon. Friend is my hon. Friend--

Helen Jones: I am never upset.

Alan Johnson: She is always, charming, courteous and gracious.
 The Department of Health is also developing a comprehensive adoption support framework, which will be published for consultation later this year. The Government recognise that under existing arrangements, provision of adoption support services is patchy and inconsistent. The Adoption and Children Bill, which is also in Standing Committee, places, for the first time, a clear duty on local social services to provide adoption support services. The new duty will ensure that all local authorities make adoption support, including financial support, available. Local authorities are best placed to decide whether to provide adoption support services to individuals--and if so, which services--based on need and resources available locally. The Government will set out the range of adoption support services that local authorities will have to provide as part of the new national framework, which will ensure that many more adoptive families receive the support they need. 
 In addition and as with low-paid parents taking paternity leave, we are carefully scrutinising the benefits system to ensure that it is geared up to work for low-paid adopters when they need support to take adoption leave. The Department for Work and Pensions is working on the details to ensure that parents taking adoption leave have, as a minimum, the same access to benefits, including income support, housing benefit and council tax benefit, as a mother on maternity leave. The likely level of benefit would ensure an income of at least £100 a week. If a parent's partner is in work, help will be available through tax credits and in-work benefits. That may deal in part with the point raised by my hon. Friend the Member for Warrington, North, but I shall return with a full response.

Joan Humble: One difficulty that puts many people off claiming benefits is the perceived complexity of the process and filling in the forms. In discussions with his colleagues in the Department for Work and Pensions, will my hon. Friend ensure that they try to simplify the process so that fathers in particular are not put off claiming their entitlement through the benefits system and do not choose to keep working without accessing their entitlement to parental leave?

Alan Johnson: That is very important and there are trigger points when contact is made with the individuals seeking adoption or paternity leave that we could use to ensure that the process is simplified and that people understand their entitlement. The income support rules are a matter for the Department for Work and Pensions and it will need to look further at the details, but we do not expect difficulties.
 There are initiatives with the Department of Health and a specific initiative to mirror maternity allowance for adoptive parents. They are related to the introduction of the new rights to try to tackle the problems raised by my hon. Friend the. Member for Doncaster, North and about which other hon. 
 Members have expressed concern. I am sure that my hon. Friend and other hon. Members will want to consider the proposals carefully.

Tony Lloyd: My hon. Friend may want to comment in passing on the fact that while he has embraced the principle and is trying to find practical solutions, those on the Conservative Front Bench, in contrast, have done everything other than reach a conclusion on whether it was right or wrong to establish the principle.
 My hon. Friend has gone a long way to try to satisfy the concerns raised by hon. Members on both sides of the Committee. He will recall that in the days before he was a Minister he could be frustrated by the slow pace at which the process of government works. Will he ask his colleagues from the relevant Departments to make it clear in public before Report not only that their intentions correspond with what he has said today, but when they will act on that? We do not want those on low pay to be left way behind, always to be told that they will be brought into line when the time comes.

Alan Johnson: My hon. Friend can always score his own points without my intervention. On his second point, we are happy to discuss the detail of the proposal with colleagues at the Department of Trade and Industry, the Department for Work and Pensions and the Department of Health. The measure is to be introduced in 2003, so we have some time to get it right. I hope that by the time the Bill reaches its later stages we will be in a better position to judge how that work is progressing.
 We as a Committee want to ensure that people on low pay get the support that they need. That must be done in a way that does not produce onerous burdens. Our proposals have received huge support. Nobody in any sphere of business opposed any part of the measures on adoption leave, and there was near unanimity in respect of paternity leave. It would upset that happy consensus if we dealt with the issue in the way suggested by my hon. Friend the Member for Doncaster, North. I hope that he can be assured that we are considering the problem and that we intend to solve it. 
 In response to my hon. Friend the Member for Manchester, Central, we hope to be able to resolve this, if not in Committee, later in the passage of the Bill. It would be useful for me to write to him to let him know how matters are progressing. 
 On that basis, I hope that my hon. Friend the Member for Doncaster, North will withdraw the amendment.

Philip Hammond: I rise partly to rebuff the rather churlish remarks by the hon. Member for Manchester, Central.

Tony Lloyd: I am a churl.

Philip Hammond: The hon. Gentleman has not always been churlish in the course of our proceedings.
 I anticipated earlier that the Minister would have an answer to the legitimate concerns raised by Labour Members. Most members of the Committee would agree that what he proposed is a sensible way of 
 addressing the problem—which is quite small, unless one is affected by it. I was surprised to hear that only 5,500 people a year are affected. We are talking about sums of money that are almost invisible in Treasury terms—less than £1 million a year. 
 I am sorry if the hon. Member for Manchester, Central thinks that I was seeking to avoid endorsing a particular position. I felt that the position taken by him and other Labour Members would prove to be a more complex, costly and burdensome way of achieving the same objective as the Minister's solution, and that was the reason for the guardedness of my earlier remarks. The Minister's proposals are eminently sensible and would enjoy widespread support.

Brian Cotter: I was pleased that the Minister said that he would address the issue of low earnings in relation to those adopting. We all hope that adoption levels will rise so as to deal with situations in which children are in need.
 I was encouraged to hear the Minister discussing the self-employed. I must apologise to the Committee for my absence, which was for the good reason, as I am sure that hon. Members will agree, that the loss of 300 jobs in Weston-super-Mare was announced today. People may know that I am the small business spokesman for my party, but I do not want to raise the question of the self-employed in that context. Many of those 300 people who have lost their jobs may want to become self-employed. 
 The hon. Member for Hertford and Stortford introduced a Bill yesterday, which I supported, to encourage the self-employed. The self-employed are not always so-called rich people going around in big cars—many have been made redundant and want to start again. I am sure that hon. Members are aware of the excellent work of the Prince's Trust in encouraging young people and others to get into employment. I encourage the Minister to discuss the self-employed because most of them are not fat cats, and some help would be appreciated. I am grateful that he is going to examine, address and tackle these issues.

Kevin Hughes: We have had an excellent debate. The Minister has heard compelling arguments from both Government and Opposition Members, and I am grateful to every hon. Member who has taken part in the debate for making their specific points.
 The Minister has listened, and I was pleased to hear that he accepts that the principle is right and that he shares our concerns. The issues are complex, and I can see why the arguments about the link to NICs are particularly important. I am pleased that he explained how the Government intend to deal with the important issues that the Department for Work and Pensions and the Department of Health are examining concerning low-wage adopters. The Department for Work and Pensions is also considering income support or some kind of allowance. I have every confidence that the Government will thrash out the complex detail surrounding this issue and bring forward some positive proposals.
 The Minister seeks to resolve the situation, and I am confident that he will find a solution. Indeed, he has given me sufficient confidence to beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

Philip Hammond: On a point of order, Mr. Conway. It is ten minutes to five o'clock on Thursday. I asked at the Committee's sitting on Tuesday about the timetable for making us aware of the Government's apparently substantive proposed new clauses. One problem with strictly timetabled Committees is that the Government can, if they are so minded, table many extensive new clauses as late as next Friday afternoon, which would require the Committee to debate and deal with them on the following Tuesday. We have a serious need to discuss with bodies outside Parliament what is in effect a whole new area that is being added to the Bill.
 I seek your guidance, Mr. Conway. as to the mechanism for seeking a reconvention of the programming sub-Committee in the event that the Government do not table the new clauses tomorrow. In that case, given the concurrent activities of the Committee, we would find it practically impossible to meet with the necessary outside bodies to synthesise opinions and table the necessary amendments to the new clauses in time. Would you please guide us?

Derek Conway: I am grateful to the hon. Gentleman for making that point. The issue is not one for the Chair, but I am sure that the Minister heard what the hon. Gentleman said. As the House passed the programme motion, amending it is a matter for Mr. Speaker. The hon. Gentleman can doubtless seek the advice of the Clerk of the House on whether a motion could legitimately be tabled for the House to consider. As matters stand, however, the issue is sadly not one for the Chair.

Alan Johnson: Further to that point of order, Mr. Conway. I said on Tuesday that I want the new clause to be available as soon as possible, but that producing it by the end of the week was pushing things a bit. As I understand it—I have never dealt with such matters before—the convention governing a new clause is that it be laid a week before it is due to be debated. To comply with that convention, it would therefore have to be laid by Tuesday. As I said, I want to lay it as soon as possible, and I certainly want to keep in line with convention. It is of no advantage to the Government to introduce a new clause, only for members of the Committee to become concerned and upset because they have insufficient time to debate it.
 Although I understand the convention and I want to produce the new clause as soon as possible, the Government have to go through various machinations and seek the approval of various Departments. For that reason, I doubt whether the new clause will be produced by tomorrow, but I hope that it will be produced by Tuesday. If it is not, I, too, will want to explore the opportunities for reconvening the Programming Sub-Committee, so that we can give a week's notice. Thanks to your clarifying matters, Mr. 
 Conway, I now realise that in such a case a motion would have to be put before the House, so we will bust a gut for Monday or Tuesday.

Philip Hammond: I am grateful to the Minister for his explanation. I do not doubt that he is doing is best, and he has shown no inclination towards concealing matters from the Committee. I accept that a week is normally considered adequate for new clauses, but this is a slightly unusual case. By the Minister's own admission, the new clauses will tack on to the Bill a wholly new area. I look forward to receiving a copy of them as soon as the Minister can provide one, but if it proves impossible to table them by Tuesday, perhaps we can address the matter again then.

Derek Conway: We can now move on to amendment No. 126.

Philip Hammond: I beg to move amendment No. 126, in page 6, line 7, leave out subsection (3).
 The question of whether periods of pay will be available for each child in the case of a multiple birth has been dealt with in a previous debate. Rightly or wrongly, the Minister decided that there will be only one period. Given that the amendment was merely a probing amendment, I see no point in pressing the matter and I beg to ask leave to withdraw the amendment. 
 Amendment, by leave, withdrawn.

Philip Hammond: I beg to move amendment No. 129, in page 8, line 8, leave out from 'State' to 'is' in line 10 and insert
''shall, by regulations, provide that all statutory paternity pay and associated employers National Insurance Contributions, together with an amount calculated by the Secretary of State to equal the average cost to employers for each employee to administer''.
 The amendment seeks to ensure that the Secretary of State will make regulations dealing with the recovery of amounts paid by employers. Again, it moves from a permissive to a prescriptive situation, and goes further by requiring that the commissioners of Inland Revenue meet not only the direct costs and national insurance contribution costs, but an amount specified by regulation—in other words, an amount on which the Government can decide—that fairly reflects the administrative cost incurred by an employer in carrying out yet another task on behalf of the welfare state. In earlier discussions, we all acknowledged that there are direct and indirect costs to business in this part of the Bill. In the case of small businesses, nearly all the direct costs will be recovered by the employer. In the case of large businesses, that is not so, and only a portion of the direct costs, albeit quite a large proportion, will be recovered. But nowhere is there any attempt to allow them to recover the indirect costs. 
 The indirect costs for employers are twofold. First, there is the administrative cost of the scheme. Successive Government schemes have in effect used the employer as a benefits office, implementing the welfare state through the mechanism of employer payments. The second indirect cost is the 
 organisational burden of having people absent from work. Clearly that cannot be compensated for by a straightforward payment. I suggest to the Minister that although the administrative cost of running the scheme and making the payments will be relatively small, it would be a gesture well received if he were able to agree that not only the direct payments and the national insurance contributions, but an appropriate allowance to cover administrative costs, could be recovered by employers. 
 In the United States, employer-administered benefits are dealt with in that way. Small businesses, at least, are able to recover a sum for their administrative costs. It was intriguingly suggested to me that the Chancellor of the Exchequer was interested in that scheme. It is certainly a frequent complaint of small businesses with which both the Minister and the Minister with responsibility for small business will be familiar. I wonder whether he might be able to deliver some good news to small businesses on this rather cold Thursday afternoon by saying that he is minded to consider making the total costs of administering the scheme recoverable in the way suggested in the amendment.

Mark Prisk: The amendment is apposite. Subsection (3) appears to allow the Secretary of State initially to widen the liability of the Government or the board where he chooses to do so. One could read it another way and infer that he might also be able to reduce the liabilities. Is the purpose of the clause to extend the liabilities of the board, or would it be permissible for the Secretary of State to be able to reduce the liabilities of the board? That is not clear.
 It is welcome that the amendment seeks exactly to define the powers of the Secretary of State. For example, could he alter in any way the small employers relief scheme by changing the board's liabilities? Could he adjust in any way employers' generally recoverable 92 per cent. of costs? I trust not, but it would be helpful if the Minister could clarify that on the record.

Philip Hammond: I may be missing something, but I am afraid that I am much less sanguine than my hon. Friend. My reading of the Bill is precisely that the Secretary of State will be able to determine employers' percentage recovery and the operation of the small employers scheme through regulations, and thus pretty much in any way that he chooses.

Mark Prisk: Having heard the Minister speak on many occasions in this Committee, I am always happy to give him the benefit of the doubt, but my suspicion is that this apparently innocuous subsection—on the back of the liabilities section of the Bill—may give the Secretary of State a range of powers that go beyond the intentions of employers groups, which have, to date, supported the Bill.
 Although the Government speak eloquently and, I believe, genuinely about the importance of statutory maternity pay, the danger is that they might be limiting their financial liabilities in supporting that apparent commitment. I am sure that it is not the Minister's intention to be seen to be generous with other people's money. I support the amendment because it seeks to 
 define the state's liability, and provide a definition that includes direct pay costs and reflects the important and significant administrative costs that fall on small employers.
 Debate adjourned.—[Mr. Pearson.] 
Adjourned accordingly at one minute past Five o'clock till Tuesday 15 January at half-past Ten o'clock.